Monday, January 08, 2007

Reason #15--Human Rights Deserve A Chance

I went to see DeNiro's CIA movie The Good Shepherd this afternoon, and one thing I think it captures very well is the way the unwritten laws of a system can overshadow and ultimately obliterate whatever we think it stands for. By the end of the movie, whatever ideals motivated Matt Damon have become worse than empty abstractions and worse than lies; they've become ruses for a force that can only be described as inhumane. After all, whether he realizes it or not, his loyalty to his ideals has pretty deliberately destroyed his own family.

In the early stages of Wage, Labor & Capital, this is precisely what Marx wants to show. The overall story of capitalism, the arc of the story, is defined at its molecular level. The injustice starts with the first lie. Yes, capitalism allowed producers to rise to the level of the old ruling class, the aristocracy, but it not only allowed slavery; it demanded that the majority of people be subservient to a class of business owners. While industrialized nations have seen great increases in the standard of living for most, real equality slips further from our grasp on a worldwide scale. Most of us know that corporations may have all the rights of individuals, but individuals don't have the same rights as corporations--recent changes in bankruptcy laws are just one example. Marx wants to show why that inequality is part of the DNA of the capitalist system.

As with the serenity prayer, Marx would say we need to know and accept what we can't change before we have any real hope of seeing what we can.

From Monsters, Marx & Music:

In Wage, Labor & Capital, Marx starts with our paychecks. In the main, a business owner is only going to pay us what’s necessary to keep the business running, what the market demands. In any meaningful sense, our humanity doesn't enter into the equation.

If you take the human costs out, this point is obvious with all other business expenses. Any grocery chain wants to install the cheapest, most effective automated check-out machines available. Companies like Wal-Mart, that make enough money to cut expenses in every way possible as soon as the technology is available, have an edge on their competition.

So why do we think Wal-Mart (or any competitive company) would treat the cost of workers any differently? You may build in exceptions for uniquely talented individuals and you can allow for some elbow room for some degree of loyalty or quality or whatever, but it is simply bad business if companies pay their workers any more than the market says they are worth.

And how much is a checker worth, for instance, when he or she is in competition with a machine that does the same job for only its upfront price and occasional maintenance? Wages get determined by aggregate costs based on such comparisons.

The bottom line is pretty crude and discomforting when it’s looked at this way. Wal-Mart only has to pay workers enough to keep a staff showing up each day to keep the business open and profitable. Just like it needs to calculate the cost of replacing an automated checker when the parts wear out, a seriously competitive company needs to factor in the costs of replacing necessary workers.

This means they do need to figure in enough to keep families reproducing and raising their kids, but even those numbers go lower all the time. Anyone who’s worked in a factory knows that story well, but anyone who’s been in a Wal-Mart since the millennium just has to reflect on how automated check out machines have caught on. Every year, less workers are needed to keep those doors open. Every year less workers are needed period. Though the worldwide tapping of new markets can change this in terms of sheer numbers, it doesn’t change the direction obvious in the ratios or slow the widening gap between the rich and poor.

When I took Economics 101 in school, my teacher insisted on the fundamental democracy of supply and demand. Producers need well-paid consumers to demand their products, and workers will choose to work for one company versus another because one company supplies a better work environment than another.

How does this apply to a company like Wal-Mart, a company that has virtually put every form of retail and service oriented industry in places like my hometown out of business or on notice? The prices are dirt cheap and the worldwide production costs to stock those shelves gets cheaper all the time.

Supply and demand may have democratic qualities, but they sure don’t have to be concerned with the interests of any individual or his or her family.

In fact, for all of Wal-Mart’s talk about family values, the value of the family is being weighed against the cost of doing business, and the time families spend together isn’t even part of the equation. The boss buys that automated check-out machine with a guarantee of so-many hundreds of thousands of bags it should check for free after it is paid for. In the same way, the boss pays wages based upon a concept of the average worker’s maximum potential output. The harder we work in our 8 hours, the boss makes more money for the same investment. In truth, our boss is not simply paying us to work 8 hours but in fact buying our potential for increasing profits every 24 hours.

When a friend managed a team of workers for a national floor cleaning business, he was praised for making profits in excess of the year before, and then he was immediately handed a higher goal for the following year. I’ve seen more nods than I can count when I’ve told his story to others in similar positions.

A basic law of business is that companies that aren’t growing are dying [a big part of Wage,Labor & Capital is showing why that’s true], but what that means for the average worker is that success means heightened expectations and harder work the following year than the year before. On that level alone, it’s reasonable to begin to suspect that keeping a job potentially means giving up more and more family time and energy.

With the almost complete destruction of the labor movement over the past few decades, we’ve seen precisely this tendency toward increased overtime and less family time for those who want to stay vital in the workforce. Wage, Labor & Capital tackles the essence of that inertia and where capitalism’s blind momentum is sure to take us. And, once again, we’re back on the runaway train.